Food consumption patterns in rural Pakistan

TL;DRAbstract

Assessing the impact of government policies on food consumption behavior requires knowledge of demand system parameters. In Pakistan where regional consumption habits differ considerably, estimating such a system requires careful modeling of habitual behavior. Previous demand studies have not handled the regional heterogeneity of consumption patterns in a satisfactory manner. Also, some of these studies relied on restrictive assumptions regarding consumer preferences. As a result, there is little consensus on values of demand elasticities for even the key food commodities;This study proposes the hypothesis that regional consumption patterns differ because of habits induced by long-term relative prices. Differences in regional relative prices stem from inadequate and unevenly developed infrastructure. Stability of price differentials between regions causes persistent biases in household consumption towards cheaper local foods and, in the long run, leads to formation of strong habit for

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